Monday, 3 December 2007

Russian rail picks banks for stake sale

Financial News

Jason Corcoran in Moscow

03 December 2007

Russian railways monopoly RZD has chosen investment banks UBS and Troika Dialog to manage the sale of a 15% stake in its freight subsidiary Transcontainer.

The private placement is part of the third stage in the reform of the Russian rail sector, which envisages selling stakes worth $15bn (€10.2bn) in parent RZD and its subsidiaries on the stock markets.

RZD said it needs 13 trillion roubles (€362bn) to modernise its network. It also wants to use the 9,288km Trans-Siberian Railway to carry more container freight from Europe to Asia.

UBS and Troika beat off competition from 10 other banks which were admitted to the tender. A roadshow for sale of shares will kick off next week with the European Bank of Reconstruction and Development tipped as a buyer of 10% of shares worth $250m. An IPO for 25-30% of Transcontainer’s shares is expected to be held early next year.

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